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Joined: 28 Dec 2005 Posts: 11966
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Posted: Wed Jul 04, 2007 5:50 am Post subject: Relationship of Oil Prices on SPX and OIH |
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The first chart shows the relationship between the price of oil (red line) and OIH (black line), and the second chart shows the relationship between SPX (red line) and OIH (black line). The two charts suggest if the price of oil continues to rise, OIH may not rise much or fall, while SPX may fall, and if the price of oil falls, OIH may fall, while SPX may rise. So, short-term, OIH puts may be a safer trade than SPX puts. Consequently, OIH Aug 180 puts, which closed at 6.90, may be best.
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